Virgin Atlantic Sacks Nigerian Crew, Set to Pull Out of Nigeria
The Nigerian aviation sector was on Saturday thrown into confusion when news filtered in that Virgin Atlantic Airways is pulling out of the country. Though the airline is yet to officially announce its pullout, sources close to the regulatory authority revealed that Virgin Atlantic has shut down its call centre in Ikeja and has also sacked its Nigerian Cabin Crew.
Since it was launched in March 2005, Virgin Nigeria has been enmeshed in controversies. First, it was the controversy over the operational route. While other airline operators complied with the federal government’s directive to leave the international wing of the Murtala Muhammed International Airport, Virgin Nigeria said it was a breach of its operational agreement.
Another part of the crisis is the recent resignation of the airline’s top management staff. It was also discovered that the speed with which Virgin Atlantic recouped its part of the working capital from the airline also caused untold hardship for the company.
Newsworld gathered that the airline is in debt of a whopping $203.5 to UBA Plc. As a result, after the withdrawal of Virgin Atlantic, the bank decided to take up the 49 percent share of Virgin Atlantic, as a part of getting back it’s funds out of the crashing airline.
Also, it was gathered that Richard Branson has entered into an agreement with UBA to take over his share in the airline just after the former President Olusegun Obasanjo left office, that he was going to quit as it was the former president who convinced him to invest in the nation’s air transport sector.
Presently, the airline has withdrawn from some of its international and regional routes; the fleet has dropped by 40 percent and will still drop. The two Boeing 767 airlines used for London and Johannesburg routes have been returned to Smart Lyric, who are the owners of the aircrafts. Again, two folker 50 aircrafts used for its Benin and Warri routes have been returned to its owners according to the management. Newsworld gathered that things slipped so fast forcing the managing director and other expatriate management staff to resign, having realised that they were unable to save the airline from total collapse after three years of trial and error. But their exit was linked to the expiration of technical service agreement, TSA, signed between Virgin Atlantic and Virgin Nigeria.
Due to the withdrawal of Richard Branson and his men, the other shareholders decided to cover up and appointed Captain Dapo Olumide as the new managing director and what is left is the brand name which Branson can come back for at anytime, meaning that virgin has lost its virginity.
The outgoing managing director, Mr. Connad Clifford when handing over to Captain Olumide, stated that the only thing that could save the company is if the airline runs to the stock market for financial help as all the banks who have been financing the airline are not ready to continue as a result of the economic meltdown.
Captain Dapo Olumide stated that the airline will be resuscitated and repositioned to become profitable. He stated that he has the confidence that the airline will not die in his hand. He also stated that coming on board at a period when the global airline industry is going through challenges is quite tasking, but having a team of hardworking personnel, he is sure that they will further position the airline and make it safe and profitable.
According to records, Virgin Atlantic Limited had in 2005 invested $25 million (representing 49 percent equity) in Virgin Nigeria and the other 51 percent balance is owned by Nigerian shareholders including Capital Alliance Nigeria Ltd, Dantata Investment Security Ltd, UBA Global Markets, IBTC Ventures Ltd, BGL Ltd, Asset Resource Insurance and Management Ltd, Industrial and General Insurance Plc, UNIC Insurance Ltd, African Alliance Company Ltd and the Nigerian government.
Following a long drawn battle between Sir Richard Branson and the federal government, firstly over where the airline should operate from and then on the exorbitant management fees, led him to state that Virgin Atlantic was reviewing its shareholding and was thinking on whether to retain the brand in Virgin Nigeria or not.
Newsworld also reported that Virgin Atlantic has finally reduced its shareholding from 49 percent to seven percent so as to allow the airline continue to use the brand name. But this has been denied by Virgin Nigeria’s corporate communication manager, Mr. Francis Ayigbe, who stated that Virgin Atlantic is still part of Virgin Nigeria as technical partners.
The minister of aviation, Mr. Babatunde Omotoba has held an emergency meeting with the Virgin Atlantic representative, Chief Adebayo, and will meet the owner of Virgin Atlantic, Mr. Richard Branson in London on the 12th of June to further convince him to return back to Virgin Nigeria.
Newsworld reported that the federal government is not willing to let the airline collapse as it will send a bad signal to foreign investors in the aviation sector.
Newsworld gathered that Virgin Nigeria was not properly put together. This was in a statement made by Captain Dele Ore, the president, Aviation Round Table, ART, an aviation pressure group based in Lagos. He revealed that when Virgin Nigeria was being put together, the Obasanjo government did not have Nigeria and Nigerians as the focal point.
According to him, the government is now facing the realities on ground as that is the reason why Captain Ore advised that the airline should not be allowed to fold up.
He revealed that the problem is that the airline’s workforce is over bloated, all its aircrafts are over valued by the leasing companies, then these aircrafts are used for local flights which can produce the much needed profits.
He stated that good aircrafts should be gotten at best lease rate.
The airline had commenced a mass retrenchment of its staff since last year, and presently, all its accounts as well as its sale proceeds are domiciled with the UBA .
Posted by Janice Johnson (Source: Proshare.com)
